In Dutch case law it has long been held that the bankruptcy of a Dutch partnership automatically entails the bankruptcy of each of the partners. In a decision that explicitly breaks with previous case law, the Dutch Supreme Court found on 6 February 2015 that the bankruptcy of a Dutch partnership does no longer entail the bankruptcy of its partners. If the criteria for bankruptcy (in short: that the debtor has ceased to pay its debts as they fall due) are met by the partnership, the court should only open insolvency proceedings with respect to individual partners after determining that they themselves meet the insolvency criterion.
The Supreme Court notes that – in view of several developments in the law over the past years – there are situations in which an individual partner should not be declared bankrupt. The Supreme Court mentions two specific examples: where the partner has sufficient funds to pay his/its debts or where the partner is an individual who qualifies for the statutory debt scheduling regime. The lower court will now have to investigate separately whether the partner in this case, who was represented by NautaDutilh in the proceedings before the Supreme Court, must be declared bankrupt because he meets the criterion himself.